Declining oil prices threaten Iraqi stability

Plummeting oil prices may force Iraq’s government to slow ambitious reconstruction plans, and the country could face a budget shortfall by next summer, U.S. and Iraqi officials said.

“We’re in a situation where Iraq is


The trend worries U.S. officials who say a strong economy is needed to lock in the security gains made over the past year. “The long-term stability of the country heavily depends on a vibrant economy,” Brinkley said.

Iraq, which sits on the world’s third-largest oil reserves, gets at least 90% of its revenue from oil sales. Crude oil prices have dropped about 70% since July when they topped $147 a barrel.

Iraq’s government is considering slowing, but not canceling, major reconstruction projects, Brinkley said. Many projects were planned during Iraq’s massive oil windfall earlier this year.

USA Today